A distraught dad who was encouraged to top up his mortgage twice during the economic boom considered taking his own life when he was hounded by his broke bank.

John, not his real name, was driven to despair after his debts escalated and the struggling lender threatened to take his home from him.

He told the Irish Sunday Mirror. “It was horrendous, I thought we were going to lose everything.

“Some months it was a choice between making a repayment on the car, which I needed for work, or paying the mortgage. Other months it was a choice between that or putting food on the table for our three kids.

“I was using the credit card to live and then it got to the stage where we couldn’t pay that back – we were sinking further and further into debt.

“I was getting phone calls from the different lenders and threatening letters and I couldn’t cope.

“I wouldn’t answer my phone if I didn’t know the number.

“I wasn’t able to eat or sleep. I was crying, I didn’t know what to do.

“I was so bad that my son actually feared I was sick. I overheard him asking ‘does dad have cancer?’.”

John and his wife bought their house – now in negative equity – 10 years ago and during the good times letters came in from their lenders offering more money.

He said: “We were enticed to top up our mortgage twice which we did for home improvements. I have an extension we didn’t even really need.

“Ironically, we don’t even use it now because we can’t afford to heat it. I wouldn’t looked for money for it but when it was offered I was drawn in.”

The couple were managing to cover repayments of €1,320 a month then the financial crash came.

Extra taxes and cuts to John’s salary meant his pay dropped significantly and they struggled.

The pair were plunged further into debt when his wife’s job was slashed to three days a week.

John recalled: “I really thought we were going to lose our house.

“I was on the verge of a nervous breakdown and if my friend hadn’t intervened and brought me to financial advisors MoneyBloom, I think I would have been in the river.

“They were my lifesavers. They took over, contacted all the lenders and restructured my loans.”

Statistics reveal there were 136,564 mortgages in arrears in the final three months of last year, representing almost 18% of mortgage holders.

And the Central Bank figures show a big increase in the number of people in long-term arrears of 720 days or more.

These account for around 33,000 families and individuals who face losing their homes if they can’t agree a deal with their lender.

While John managed to hang on to his house, others are not so lucky. There has been a surge in repossession orders before the courts all over the country.

The Central Bank said proceedings concluded in 258 cases and in 82 hearings the courts granted an order for repossession or sale of the home.

Last week in Galway, more than 80 cases came before the courts.

This was just two months after the ratings agency Fitch predicted one in five houses – as many as 26,000 – where mortgages have been in arrears for three months or more are likely to be repossessed.

Clare Dooley from MoneyBloom

Clare Dooley of MoneyBloom revealed the company in January stopped 23 repossession bids and assisted 450 inquiries from people “desperately seeking help”.

She said: “Five years since the financial crisis and there is still no let-up for the ordinary homeowner struggling to make ends meet.

“Thousands of homeowners are still suffering in silence and are desperate for an end to their financial and personal nightmare.”

While the banks have been bailed out, homeowners in debt are being aggressively pursued by creditors.

Ms Dooley said: “While we all sit back and watch the bank bailouts and even the State seeking write-down from its European partners, the man and woman on the street is still feeling the full force of the recession at the hands of their creditors.

“Creditors are relentless in their pursuit to collect a debt and are often oblivious to the difficult financial situation that borrowers are in.

“Constant harassment, refusal of negotiation efforts and the constant threat of legal proceedings can all take their toll on the borrower and their families.

“Borrowers continue to slog through attempted negotiations with their creditors and enter into agreements, only to find themselves defaulting as the agreement was never sustainable in the first place.”

The majority of clients seeking help have either exhausted their own avenues of trying to reach a deal with creditors, or have taken the “ostrich approach”, hoping the problem would sort itself out.

But Ms Dooley warned court orders or repossessions are inevitable if the borrower and lender cannot find middle ground.

While the Central Bank reported a 3.3% fall in arrears for the final quarter of last year, the decline appears to be impacted by asset sales.

Ms Dooley said: “If a bank has assessed a mortgage as no longer sustainable, it proceeds down the road of a repossession order.